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Gold, Fibonacci levels analysis​

Daily overview
On the daily chart, the price continues to test 1921 (correction 50.0%), and the consolidation below it allows a decline to 1890 (correction 61.8%), 1850 (the area of January highs). However, an ascending fan may prevent negative dynamics. The key "bullish" level is 1951 (correction 38.2%), supported by the middle line of Bollinger bands. Its breakout will give the prospect of further growth to 1990 (correction 23.6%), 2050 (correction 0.0%).

Technical indicators do not give a single signal: Bollinger bands are horizontal, Stochastic reverses upwards, but the MACD histogram decreases in the negative zone.
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Weekly overview
On the weekly chart, the price tested 2033 (correction 0.0%) but is now correcting downwards. A break of 1890 (38.2% ascending fan line) further declines to 1835 (23.6% correction, middle line of Bollinger Bands). Otherwise, the quotes will be able to return to 1990 (upper line of Bollinger bands), 2033.

Technical indicators do not give a single signal: Bollinger bands are directed upwards, Stochastic is directed downwards, and the MACD histogram increases in the positive zone.

Resistance levels: 1951, 1990, 2050 | Support levels: 1921, 1890, 1835​

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Gold, the pair may grow​

On the daily chart, the third wave of the higher level 3 of (5) develops, within which the wave iii of 3 forms. Now, the third wave of the lower level (iii) of iii is developing, within which the wave iii of (iii) has formed, the correctional wave iv of (iii) has ended, and the development of the wave v of (iii) is starting.

If the assumption is correct, Gold will grow to the levels of $2150 - $2200. In this scenario, critical stop loss level is $1890.​

 

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Gold, rising US Treasury yields are pushing the instrument lower​

Gold prices are developing "bearish" dynamics, testing the level of 1920.00 for a breakdown. XAU/USD builds on the downward momentum that was formed at the end of last week, when the US currency received support after the publication of a strong report on US Non-Farm Payrolls and an increase in Treasury yields amid market expectations of a tightening of the US Federal Reserve policy, which could become a catalyst for raising interest rates soon.

As expected, the economy created a little less than 500K new jobs, but at the same time showed a steady increase in Average Hourly Earnings and a drop in the Unemployment Rate from 3.8% to 3.6% (forecasts suggested a decrease to only 3.7%). Strong data confirmed the likelihood that the US regulator will decide to raise interest rates during its May meeting by 50 basis points at once. At the same time, markets are also reacting with a noticeable increase in the yield of US Treasury bonds: on 10-year securities, it rose to 2.414% on Monday morning after closing at 2.375% at the end of last week.

In turn, gold is still supported by the tense situation around Ukraine. The positive impetus received from the results of the next round of talks between the Ukrainian and Russian delegations in Turkey at the beginning of last week seems to have leveled off after the appearance of new evidence of the aggravation of the situation in certain territories of Ukraine and, in particular, in the Bucha district. Meanwhile, Western countries have announced their readiness to impose new sanctions against the Russian Federation, which threatens to further complicate the situation with rising energy prices. Against this backdrop, gold quotes will continue their uptrend, as investors will redirect their capital to safe-haven assets in order to minimize risks.
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Support and resistance​

Bollinger Bands in D1 chart demonstrate flat dynamics. The price range is slightly narrowing from above, reflecting ambiguous dynamics of trading in the short term. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic, after a short rise at the beginning of the last trading week, is again reversing into a horizontal plane. It is necessary to wait for the trade signals from technical indicators to become clear.

Resistance levels: 1930, 1952, 1974, 2000 | Support levels: 1900, 1877, 1860, 1840​

 

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Central banks continue selling gold​

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Yesterday, the World Gold Council (WGC) provided a preliminary report on the market state. The organization noted that in the first quarter of 2022, there was a trend for the sale of physical gold from the reserves of central banks, and this is the first period since 2020 when such a trend has been recorded. Most actively in February, metal was sold by such countries as Uzbekistan and Kazakhstan. In particular, Uzbekistan reduced its reserves by 22 tons, and Kazakhstan – by 21 tons, and for it gold reserves became the lowest since 2020. Among the bullion buyers during this period, only India and Ireland were noted, which replenished their stocks by a modest 2.6 tons and 1 ton, respectively.

The US Commodity Futures Trading Commission (CFTC) data confirm the global sell-off trend. According to the report for the last week, the number of positions of buyers secured by money amounted to 84.554K, while the same figure for sellers reached 335.029K. At the same time, the weekly change in positions indicated an increase in sellers' contracts by 772 and a decrease by 5.858K contracts among buyers.
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The price is correcting within the local Triangle pattern on the daily chart. Technical indicators maintain a weakened buy signal: fast EMAs on the Alligator indicator have come close to the signal line, and the AO oscillator histogram has moved into the sell zone, having formed the first bars below the transition level.

Resistance levels: 1957, 2050 | Support levels: 1900, 1830​

 

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Gold, the pair may grow.​

On the daily chart, the third wave of the higher level 3 of (5) develops, within which the wave iii of 3 forms. Now, the third wave of the lower level (iii) of iii is developing, within which the wave iii of (iii) has formed, the correctional wave iv of (iii) has ended, and the development of the wave v of (iii) has started.

If the assumption is correct, the pair will grow to the levels of 2150 - 2200. In this scenario, critical stop loss level is 1890.

 

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XAUUSD shows moderate growth during Asian trading, testing the level of 1960 again. The day before, the instrument has already made attempts to consolidate above it, having updated local highs from March 14. Gold prices briefly rose to a monthly high on fears of increased inflationary risks in Europe and the United States, which was the reason for the purchase of the metal, but closer to the end of the Monday afternoon session, the "bulls" lost most of their gains. Financial markets are under pressure from geopolitical tensions and the desire of central banks to tighten monetary policy amid soaring consumer prices and associated fears of a recession. This, in turn, continued to benefit traditional safe-haven assets and pushed spot prices higher into the area of 1958 - 1960. The US dollar is also stable and is hovering around high levels around 100 in the USD Index.

Tomorrow, investors are waiting for the publication of inflation data from the US. Despite a number of active measures taken by the US Federal Reserve to contain it, analysts expect the annual value to accelerate to 8.4% in March. The biggest contributor is likely to come from higher energy prices as commodity markets surged to new record highs due to the sanctions policy against the Russian economy. According to the published minutes of the meeting of the Federal Open Market Committee of the US Federal Reserve (FOMC), the regulator intends to reduce the balance sheet by 95 billion dollars every month, starting from May of this year, and accelerate the rate of interest rate hike to 0.50%. In general, officials are optimistic about changing the current parameters to fight inflation, believing that the US economy is strong enough not to experience a recession in the face of geopolitical tensions.

Bollinger Bands in D1 chart show moderate growth. The price range is slightly widening slightly but does not conform to the development of the "bullish" sentiment yet. MACD indicator is growing, while preserving a rather stable buy signal (located above the signal line). Stochastic is showing similar dynamics; however, the indicator line is approaching its highs, indicating the risks of overbought instrument in the ultra-short term.

Resistance levels: 1,974, 2,000, 2,015, 2,030 | Support levels: 1,952, 1,930, 1,900, 1,877

 

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XAUUSD is correcting upwards at 1973. Yesterday, the World Gold Council (WGC) published a report on the state of the market in Q1 2022, which noted a clear positive momentum for the price of the precious metal.

According to the published report, the main influence on the quotes was the increased demand from ETF funds and private investors. In particular, the volume of gold held by ETF funds increased by 269 tons in the quarter alone compared to data at the end of 2021, which is the most dynamic increase since 2020. In addition, the US Mint noted the increased interest of market participants in bullion gold coins in Q1 2022, with total sales of 518K troy ounces, showing a record pace since 1999.

High demand for contracts is also confirmed by data from the US Commodity Futures Trading Commission (CFTC). According to last week's report, the number of net speculative positions in gold was 245.5K, well above the average of 200K at the end of January this year.

In addition, investors continue to evaluate data on March inflation in the United States, which reflected an increase in consumer prices by 8.5% in annual terms, which is the highest value since December 1981. At the same time, core inflation, excluding food and energy prices, slowed down somewhat compared to the February level. Now the market is waiting for decisive steps from the US Federal Reserve. In particular, the interest rate is expected to be raised by 50 basis points at once at the meeting in May.

On the daily chart of the asset, the price is correcting within the global rising channel, being near the resistance line. Technical indicators maintain the buy signal: fast EMAs on the Alligator indicator again began to expand the range of fluctuations in the direction of growth, and the histogram of the AO oscillator moved into the buy zone, forming the first bar above the transition level.

Support levels: 1958, 1915 | Resistance levels: 1983, 2050​

 

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XAUUSD, The pair may grow.

On the daily chart, the third wave of the higher level 3 of (5) develops, within which the wave iii of 3 forms. Now, the third wave of the lower level (iii) of iii is developing, within which the wave iii of (iii) has formed, the correctional wave iv of (iii) has ended, and the wave v of (iii) is developing.

If the assumption is correct, the pair will grow to the levels of 2100 - 2200. In this scenario, critical stop loss level is 1890.45.

 

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Gold, prices are approaching $2,000 again​

XAUUSD shows moderate growth during the morning session, updating local highs from March 14. The "thin" market encourages the purchase of safe assets, so the US dollar and gold strengthen their positions. The precious metal is moving higher for the second week in a row, as statistics on consumer prices in the US, where inflation in March reached 8.5% on an annualized basis, which is the highest since 1981, increases the attractiveness of XAUUSD for hedging risks in anticipation of the next financial crisis. The situation on the market changes little, as the news background after the Easter week remains quite calm.

Demand for the metal is supported by general tension, which is expressed primarily by investors' concern about global inflation rates. Due to the military conflict in Ukraine and subsequent sanctions against the Russian economy, energy quotes rushed up sharply, which provoked an increase in consumer and production prices in the global economy, which had just begun to recover from the period of the coronavirus pandemic. Under these conditions, gold actively added in price. In turn, an increase in the yield of treasury bonds, as well as expectations of further tightening of monetary policy by the US Federal Reserve, is holding back "bullish" sentiment on the instrument. Monthly bonds showed the maximum increase, having added 8.68% and amounted to 0.4108%, while the yield on 10-year bonds increased by 2.01% to 2.864%.

Today's macroeconomic statistics from China did not support the instrument significantly. GDP in Q1 2022 showed a slowdown from 1.5% to 1.3%, which, however, turned out to be noticeably better than the expected 0.6%, while in annual terms, the Chinese economy accelerated from 4.0% to 4.8%, ahead of analysts' forecasts at 4.4%.​

Bollinger Bands in D1 chart show moderate growth. The price range is expanding but it fails to conform to the surge of "bullish" sentiments at the moment. MACD indicator is growing keeping a buy signal (located above the signal line). Stochastic retains an upward direction but is located in close proximity to its highs, which indicates the overbought instrument in the ultra-short term.

Resistance levels: 2000, 2015.3, 2030, 2050 | Support levels: 1974.22, 1952.53, 1930, 1900​

 

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On the daily chart, the third wave of the higher level 3 of (5) develops, within which the wave iii of 3 forms. Now, the third wave of the lower level (iii) of iii is developing, within which the wave iii of (iii) has formed, the correctional wave iv of (iii) has ended, and the wave v of (iii) is developing.

If the assumption is correct, the pair will grow to the levels of 2100 - 2200. In this scenario, critical stop loss level is 1890.45.

 

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The XAUUSD pair is actively losing value against the background of strengthening the position of the US currency on the eve of the May meeting of the US Fed, at which the parameters of the current monetary policy can be significantly adjusted in order to combat record inflation, which reached 8.5% compared to March 2021. Analysts expect an interest rate increase of 0.5%.

Another important factor that has a serious negative impact on gold quotes is the difficult epidemiological situation in China. Official authorities report an outbreak of COVID-19 in Beijing, which again threatens a large-scale lockdown and will lead to a noticeable reduction in industrial production. Earlier, 22 non-imported cases of coronavirus infection were detected in the capital, against this background, the country's authorities ordered mandatory testing of the population in the districts of Beijing, and not which of them were closed according to the results of the inspection. This led to a fall in Chinese stocks, commodities and the yuan, while the XAU/USD pair declined to the level of 1900.

Strict anti-COVID restrictions can cause serious problems in the supply chains between Asia, the USA and Europe. The congestion of Chinese ports, combined with the military conflict in Ukraine, threatens to inflict a double blow that could undermine the recovery of the national economy, which is already experiencing inflationary pressure. Against this background, the demand for gold is falling, the price is declining, and if the situation with the delivery of goods is not resolved, the downward trend may continue up to the level of 1850 and below.

The long-term trend remains upward. The key support level is at around 1900.00 and, if it is held, the growth of the XAU/USD pair will continue with a target at the April maximum. Otherwise, it will be possible to expect a decline in quotations to the level of 1850.

The mid-term trend is downward. Last week, market participants tried to break through the resistance zone 1969.30–1962.10, but without success, and the price returned below the level. The current week began with the achievement of the first sales target in the area of the March minimum in the area of 1890.00. The second target is the zone 1872.40 - 1865.8.

Resistance levels: 1993, 2062 | Support levels: 1900, 1872, 1850​

 

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Quotes of XAUUSD have suspended growth and are being corrected down ahead of the May meeting of the US Federal Reserve on monetary policy, where a decision can be made to raise the key rate by 0.50%. Now the asset is trading around 1873.0.

Nevertheless, despite the local decline, gold continues to fulfill its main function of protecting investor capital from depreciation in the face of critically high inflation, which in the US reached 8.5% year on year. It is for this reason that the demand for the asset from the side of large market players continues to be consistently high, and since the beginning of March, ETFs denominated in gold have purchased another 100 tons of metal. Of course, in the context of the "hawkish" policy of the US Fed, XAU/USD is slowly declining, and in the event of a sharp increase in interest rates during the meeting scheduled for May 3, an acceleration of downward dynamics is possible; however, the likelihood that quotes will trade above at 1800 dollars an ounce is also quite high.

Investors' interest in trading the assets of the metal group and, in particular, gold is also confirmed by the data of the US Commodity Futures Trading Commission (CFTC). According to last week's report, the number of net positions backed by money remains in favor of buyers at 180,607 contracts, while sellers have a value of 55,640.

On the daily chart, the price is correcting as part of a local decline wave, approaching a solid support line located in the area of 1810. Technical indicators have already reversed and issued a sell signal: the fast Alligator indicator EMAs crossed the signal line from above, and the histogram of the AO oscillator moved to the sales area, having formed several bars below the transition level.

Support levels: 1865, 1810 | Resistance levels: 1916, 1978​

 

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On the daily chart, the development of the third wave of the higher level (5) of 3 continues, in which wave 3 of (5) has formed. At the moment, there is a downward correction as the fourth wave 4 of (5), within which wave c of 4 is being formed.

If the assumption is correct, after it is finished, the growth of XAUUSD will continue to the levels of 2100 - 2200. The level of 1827.33 is critical and stop-loss for this scenario.

 

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Quotes of the precious metal are being corrected in a downtrend, being at around 1883.

Investors are showing an active interest in gold as a defensive asset after the freezing of Russia's gold and foreign exchange reserves against the backdrop of sanctions imposed after the start of a special military operation in Ukraine. According to the statistics of the World Gold Council, in Q1 2022, demand increased by 34%, reaching 1.234K tons, while the volume of supply in the same period was fixed at 1.157K tons. Despite the positive statistics, at the moment one can observe a downward correction in XAU/USD, which is caused by the market's expectation of the US Federal Reserve meeting scheduled for May 4 and the tightening of the US monetary policy parameters.

Additional pressure on the metal comes from its main consumer, China. The outbreak of coronavirus in the country has not yet been contained, and last week there were reports of an increase in the incidence in its capital. Investors are seriously afraid that the authorities may impose quarantine restrictions, similar to those currently in effect in Shanghai (a total lockdown has been introduced in the industrial center, and residents are undergoing daily mass testing for COVID-19). Against this background, according to the data of the National Bureau of Statistics of the People's Republic of China, the index of business activity in the Chinese manufacturing sector in April fell to 47.4 points from 49.5 points, continuing to fall from the psychologically important level of 50 points separating growth from recession. Business activity in the non-manufacturing sector fell even more and amounted to 41.9 points against 48.4 points in March.

Thus, the number of gold contracts decreased to 218.0K from 239.8K a week earlier, according to the US Commodity Futures Trading Commission (CFTC).

On the daily chart, the price is correcting as part of a local decline wave, approaching a global support line located in the area of 1810. Technical indicators have already reversed and issued a signal to open short positions: fast EMAs on the Alligator indicator continue to expand the range of fluctuations, and the histogram of the AO oscillator, having moved into the sell zone, forms descending bars.

Support levels: 1870, 1810 | Resistance levels: 1916, 1978​

 

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XAUUSD, the instrument rushed to local lows
Gold prices are consolidating near the level of 1865 after an attempt at corrective growth the day before, which did not allow XAUUSD to consolidate on new local lows from February 16. The pressure on quotes is exerted by the growth in the yield of US Treasury bonds: the indicator for 10-year bonds last Monday exceeded 3% for the first time since December 2018 and remains in this area at the present time.

The investment attractiveness of the precious metal is decreasing before the start of the US Federal Reserve's meeting on monetary policy, which will be held today at 20:00 (GMT+2). US officials are expected to raise interest rates by 50 basis points at once, and also announce the launch of a quantitative tightening program, which should help to reduce the almost 9 trillion dollars balance sheet. Higher short-term interest rates and US bond yields tend to increase the opportunity cost of holding zero-yield bullion.

This week, the Bank of England will also hold a meeting on monetary policy, which will allow it to maintain parity, but the European Central Bank (ECB) again looks somewhat apart from this background. The regulator has not officially announced plans to tighten monetary policy, but its representatives have repeatedly spoken out in favor of such a scenario. In particular, Isabelle Schnabel, a member of the executive board, commenting on the problem of growing inflation in the region, noted that she allows the launch of a program of gradual rate increase as early as July this year.

On the daily chart, Bollinger Bands are steadily declining. The price range is changing slightly, but remains rather spacious for the current level of activity in the market. MACD is also decreasing, maintaining a relatively strong buy signal, being located below the signal line. Stochastic, having demonstrated an unsuccessful attempt at corrective growth is again reversing into a downward plane, still indicating the risks of the instrument being oversold in the ultra-short term.

 

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On the daily chart, the development of the third wave of the higher level (5) of 3 continues, in which wave 3 of (5) has formed. At the moment, there is a downward correction as the fourth wave 4 of (5), within which wave c of 4 is being formed.

If the assumption is correct, after it is finished, the growth of XAUUSD will continue to the levels of 2100 - 2200. The level of 1827.33 is critical and stop-loss for this scenario.

 

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Gold prices show moderate corrective growth, consolidating after an active decline yesterday, returning the XAU/USD pair to the local lows of May 3. Currently, the instrument is testing 1860, receiving support from technical factors.

The strengthening dollar and the growth in the yield of US Treasury bonds put pressure on the positions of the metal. Thus, the underlying 10-year securities reached 3.185%, which is the highest level since November 2018, but now, it has corrected to the area of 3.040%, while the USD Index exceeded the high of December 2002 at 104.120, but now it has fallen to 103.590. Also, last week, the US Federal Reserve expectedly increased interest rates by 50 points to 1.00% and announced the start of a phased reduction in its balance sheet. In subsequent comments, the head of the regulator, Jerome Powell, dispelled reports that in the future, officials could accelerate the pace of monetary tightening and, for example, adjust the rate by 75 percentage points. Against this backdrop, gold quotes are supported by the prospects for continued growth in consumer inflation in the US during the current quarter, although it has already reached its highest level in 40 years, around 8.5%. Tomorrow, American investors will be watching the April statistics, which may show the first signs of weakening. In particular, it is assumed that the consumer prices will be only 0.2% MoM after rising by 1.2% for March and may fall 8.5% to 8.1% YoY.

Bollinger Bands show a moderate decline on the daily chart: the price range narrows, reflecting the emergence of ambiguous trading dynamics in the short term. MACD falls, keeping a poor sell signal below the signal line. Stochastic falls close to its lows, indicating that instrument may become oversold in the ultra-short term.

Resistance levels: 1877.83, 1900, 1930, 1952.53 | Support levels: 1850.2, 1823.09, 1800, 1760.74

 

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On the daily chart, the fifth wave of the higher level (5) of 3 develops, within which the wave 3 of (5) formed. Now, a downward correction is ending as the fourth wave 4 of (5), within which the development of the wave c of 4 is ending.

If the assumption is correct, after the end of the correction, the pair XAUUSD will grow to the levels of 2070.42 - 2200. In this scenario, critical stop loss level is 1770.2.

 

[SOLIDECN]

Quotes of XAU/USD are under pressure from "hawkish" rhetoric from the US Federal Reserve and high prospects for the continuation of an aggressive monetary policy at the June meeting, in particular, a sharp increase in the rate by another 0.50%. The "bearish" momentum is expected to push gold prices towards psychological support at 1800. In addition, investors have become more inclined towards risky assets, redirecting their capital from protective ones, which also puts pressure on quotes, while the fundamental picture changes slightly.

Pressure on the position of gold is also exerted by the rising dollar, which is supported by technical factors and high yields on US Treasury bonds. However, the deteriorating economic outlook and the ongoing conflict in Eastern Europe are giving the precious metal some support. At the first sign that central banks will ease their "hawkish" rhetoric, one can expect a noticeable increase in demand for a "defensive" asset.

Among the macroeconomic factors at the beginning of the week, weak Chinese statistics should be singled out, providing additional support to the US currency. Retail Sales in China plunged to a record 11.1% in April after declining 3.5% in March. Analysts had expected a much more modest 6.0% decline.

Bollinger Bands in D1 chart demonstrate a stable decrease. The price range is expanding from below; however, it fails to catch the surge of the "bearish" sentiment at the moment. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic has been in close proximity to its lows for several days already, which indicates the risks of gold being oversold in the ultra-short term.

Existing short positions should be kept until technical indicators are clarified.

Resistance levels: 1823.09, 1850.2, 1877.83, 1900 | Support levels: 1800, 1775, 1752.87, 1730

 

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The precious metal quotes are being corrected in a downtrend, being around 1814 dollars per ounce.

The asset is declining amid fears for global demand due to the coronavirus outbreak in China, which led to serious restrictions. The negative effect on the Chinese economy can be assessed now. Yesterday, industrial production data were published in April, which fell by 2.9% after rising by 5.0% in March. Retail sales fell 11.1%, well above the 3.5% decline in March. Due to the introduced lockdown, the unemployment rate also increased, which amounted to 6.1% compared to 5.8% in March.

According to the Commodity Futures Trading Commission (CFTC), since mid-March, the number of net speculative positions in gold has decreased from 274.5K to 193.3K, and over the last week, the outflow amounted to 5.9K positions. Thus, the overall speculative position in gold is approaching the minimum levels of the middle of last year at 165–175K positions, which indicates an extremely low demand for the metal.

On the daily chart of the asset, the price is moving within the global ascending channel, approaching its lower border. Technical indicators maintain a stable sell signal: indicator Alligator’s EMA fluctuations range expands, and the AO oscillator histogram, having moved into the sell zone, continues to form downward bars.

Resistance levels: 1850, 1917 | Support levels: 1790, 1700​